Firing employees can be a difficult part of owning a business. The best approach is to know what to do before this situation arises. It can be easier on you and the employee, and you can avoid making mistakes.
Become Familiar With Your Employment Contract
Every business owner, and managers who work in their behalf, should be fully knowledgeable about the contents of employment contracts. Your legal rights and obligations should be in this contract. When you hire an employee, he should be aware of what it contains.
When it is time to fire someone, the employment contract can benefit everyone concerned. There will be fewer questions and misunderstandings when you have a solid contract.
Become Familiar With The At-Will Policy
Most states in the United States allow this policy. However, if your business has the at-will policy, it should be clearly stated in the employment contract. It will protect your rights, as you will not need to present a reason for firing an employee.
Understand What Is Covered Under Illegal-Firing Laws
You cannot legally terminate an employee from your business due to discrimination issues. The employee’s gender, race, religion, and age are in this category.
You also cannot legally fire an employee for exercising his or her legal rights, or for engaging in whistleblowing.
Keep Records Of Your Employees’ Performance
If you are within your rights in firing the employee from your business, the best approach is to keep a record of his performance. From disciplinary actions to poor work habits, these records can prevent employees from claiming they were terminated due to discrimination.
Understand The Rights Of Employees In Your Business
Understanding employee rights can protect you as well as your employees. Do not wait until you need to terminate someone before you learn this information.
Understand how COBRA affects your business. You may be required to offer temporary coverage to the employee and his dependents after he has been terminated.
When you fire an employee, you are legally obligated to provide information about unemployment insurance. He must be told if he is eligible, so he can file a claim.
Employees who are eligible for retirement plans while working for you continue to be eligible after being fired from your business.
Depending on your state’s laws, you may be required to provide the employee with his final pay check immediately after termination. There can be other requirements, such as unused vacation days. Know what your state law requires, and follow the law.
Know The Facts About Severance Pay
Severance pay is not required by law. However, if it is specified in your employment contract, you need to abide by the contract. Do not consider it a technicality that you can simply overlook. It is good for both your business and your personal integrity to be fair to your employees.
Honesty Is Good Business Practice
Although you may not legally need a reason to fire someone, it is rarely in anyone’s best interest to simply terminate an employee without a word of explanation. Whether you have given him many chances to improve, or have simply decided he is not the right employee for your company, honest communication is good for both him and yourself.
Whenever possible, approach firing an employee in a manner that will not result in hurt feelings or anger. When you make termination easier for the employee, it will also be easier for you.
While it is rarely easy to fire someone, these tips can be helpful. The employee will be more likely to move on to another job, and you will know you took the right approach.
Joshua Turner is a writer who creates informative articles in relation to business. In this article, he describes the legal aspect of firing employees and aims to encourage further study with a Champlain College Masters of Law Degree.